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Survey: Small Businesses Concerned About Effects of Health Reform Law

Many small businesses are concerned that the federal health reform law will lead to higher taxes and more paperwork without reducing costs or making people healthier, according to a recent survey by the National Federation of Independent Business, National Journal reports (Fox, National Journal, 7/25).

Methodology

For the survey, Mason-Dixon Polling and Research gathered findings from a national random sample of 750 businesses with fewer than 50 workers. The poll has a margin of error of plus or minus 3.7 percentage points (Reichard, CQ HealthBeat, 7/25).

The survey included only businesses that were familiar with the law; just 18% said they were "very familiar" with overhaul provisions, while 40% said they were only "somewhat familiar" with the law (National Journal, 7/25).

Findings

According to the poll, 42% of small businesses currently offer health coverage to workers (CQ HealthBeat, 7/25). It found that 87% of small businesses that do not offer health benefits to workers do not plan to do so any time in the near future.

In addition, the poll found that about 20% of small businesses expect to change the benefits they offer to workers, and many of those businesses expect to increase cost sharing for employees or reduce benefits (National Journal, 7/25). According to the poll, 26% of small businesses offering health plans said they might stop offering insurance if workers decide to get coverage through state-based health exchanges (CQ HealthBeat, 7/25).

In addition, the poll estimated that just 245,000 of 5.2 million U.S. businesses with fewer than 25 employees are eligible for a full tax credit to offer health insurance to workers. It also predicted that fewer than 1.2 million are eligible for a partial credit, despite claims by the Obama administration that four million small businesses will have access to the credit (National Journal, 7/25). However, 52% of respondents said they were not aware of the credit before the survey (CQ HealthBeat, 7/25).

Reform Advocates Say Poll is Flawed

Proponents of the health reform law criticized the survey, noting that it contained a flaw in one of its questions, The Hill's "Healthwatch" reports.

Although the poll found that employers are more likely to stop offering health insurance if workers choose health plans offered by insurance exchanges, reform advocates said that workers are not allowed to get insurance from the exchanges unless companies fail to provide affordable coverage. According to "Healthwatch," the survey question is reversed, and should note that workers would seek plans in the exchange only if companies drop coverage, instead of employers dropping coverage because employees are going elsewhere for insurance.

Timothy Jost, a consumer advocate and law professor at Washington and Lee University, said, "The question really has no predictive value" (Baker, "Healthwatch," The Hill, 7/25).

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